http://www.britannia.com/history/h12.html
Here is a link I have its got alot of what Epona mentioned, and some links from there. Epona can comment on how accurate it is better than I ever can, but basically its like the taking of a person in your culture, and as time goes on we tend to make them super heros. I can talk about how Rogers Rangers from the French and Indian war was incredible, I can talk about what is imperical data that we do know about him.
Basically Arthur might have been a King of early Britian, and he might have had a celtic adviser named Merlin, but we do not know for sure. Plus the ledgends do say that Merlin was a spawn of a devil (what ever a sucubus is), and so was his sister. Heck one of the wild things was that Merlin was sudecued by his sister, and they had a son who lead the revolt against Arthur. That is consider largely fiction. Arhtur can be consider an Epic story in the vein of Beuwolf, he is a hero, he might have been, he has a journey to get somewhere, something happens, and then the journey back (in a nut shell, I know you english and literay majors will rip it apart

).
Another set of ledgens of English, would be Ivanhoe, King Richard, and Robin Hood. Those are great tales of what could of happened with people we did know to exsist (well we know King Richard did).
Good reading to you.
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Drink and be merry
Jimbo
"Renegade, Rebel, and Rogue"